Presumably, KBRA hopes to grow to a point at which it rates hundreds or thousands of deals.

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

However, if KBRA ratings are made widely available, there will be little to no competitive advantage for the institutional investors.

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

Presumably, superior ratings from KBRA will help the institutional investors to make better investing decisions which in turn could lead to better returns.

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

In response to concerns about conflicts of interest, KBRA submits that its 40% institutional investor ownership ensures its primary allegiance will be to investors.

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

Over the past year, Kroll Bond Rating Agency, Inc. (KBRA) has staked out a claim in the highly-profitable and much-criticized world of credit ratings.

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

If the plan is not to investigate all these entities, how will KBRA determine which ones should be subject to deeper due diligence and which ones can do without?

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

The big question is whether the institutional investors are likely to ask their contacts at the aforementioned private equity firms to influence KBRA to generate fewer, but higher precision ratings.

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

Also, KBRA intends to resist ratings shopping by issuers.

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues

Would KBRA effectively become the rater of last resort?

FORBES: Kroll Gets Into Bond Gumshoe Biz, Faces Sticky Issues